OECD’s Base Erosion and Profit Shifting (“​BEPS​ ”) 2.0 projekt: En analyse og vurdering af OECD's foreløbige udkast til en konsensusbaseret løsning på den internationale skatte- og profitallokerings problematik, og dertilhørende initiativer, belyst ud fra en juridisk og økonomisk synsvinkel

Sara El Morabet & Yasmin Cecilie Confino

Student thesis: Master thesis


The main purpose of this thesis is to examine the “BEPS 2.0” project created and overlooked by the OECD in collaboration with the G20. The purpose of the project is to create a consensus-based approach to who and how digital firms with a ​“significant and economic presence​ ” in a respective state should be taxed. The new so-called “nexus-rules” is a plausible approach to how the taxation should be brought into action, even when neither the criteria regarding physical presence nor permanent established​ (“PE”)​ have been fulfilled.
The thesis finds it questionable whether the new nexus rule seems as effective, when it comes to imposing taxes on firms with a significant and economics presence, due to the preliminary reports being vague, not thoroughly described and detailed enough yet.
Furthermore, the thesis finds, cf. the several released reports, that OECD seems highly fixated on how to handle especially the MNE’s companies from a tax perspective, which posses an oligopoly- or monopoly like status in their respective markets.
The above mentioned criteria have for many years been considered the ultimative fundament when it comes to imposing taxation on firms operating in different states. Without neither physical presence nor “PE” there is no legal basis for taxation to be imposed cf. current tax legislation. Thus, the new-presented nexus-rules could pave the way for many new and plausible ways to both impose tax on firms but also a risking new ways for firms to dodge taxes.
In continuation to this, it is also a matter of using the right profit allocation-methods given that the new nexus-rules are implemented and enforced, as it seems questionable whether the traditional ​“arm's length principle” ​ deduced from the Transfer Pricing rules​ ​ seems eligible with this new set of nexus rules. The thesis, however, finds that the new suggested profit allocation method could result in several challenges regarding double taxation and thus the thesis ends up with a suggested solution on how to handle this challenge.
The thesis finds it questionable whether or not these new approaches are as effective as they aim to be. There seems to be more efficient alternatives to this approach as presented in the last chapter of the thesis.

EducationsMSc in Commercial Law, (Graduate Programme) Final Thesis
Publication date2020
Number of pages126
SupervisorsMichael Tell